One of the guiding principles of dividing assets on divorce is the concept of the 'clean break'. Generally, if a divorcing couple have no children or older children, a Court will try to ensure that there is a clean break between the parties to enable both parties to move on, free of the continuing need to have contact after divorce.
In law, the clean break order results in a specific outcome: that the parties split the assets on divorce and have no further claim against the other.
An order on divorce which results in maintenance payments being made on an on-going basis after a divorce does not result in a clean break and gives the parties the chance to go back to court long after they have parted. The risks of this type or order are well illustrated by a recent case.
Mr and Mrs Mills divorced in 2002 after a 13-year marriage. This son is grown up. On divorce Mrs Mills was awarded a lump sum of £230,000 plus £1,100 per month in personal maintenance payments. The lump sum represented almost all of the liquid capital of the couple. Mr Mills, a surveyor, kept his businesses.
Over the following years, Mrs Mills made what were described as 'poor financial decisions' and lost most of her divorce settlement. She fell into debt having made 'unwise' investments in so called 'upmarket' London properties.
Mr Mills retuned to court to seek an order bringing the maintenance payments to an end on the basis that he should be permitted to move on with this life. His application failed and not only that but Mrs Mills requested an increase in her monthly payments from her ex-husband.
It may be surprising to many that the couple had been divorced for longer than they had been married at the point the Court of Appeal agreed to increase Mrs Mills' monthly payment to £1,441 per month. Furthermore, Mr Mills was ordered to support his ex-wife for life as she is 'unable to meet her basic needs'.
Many would have some sympathy for Mr Mills who has stated that he 'should not be the insurer against the wife's poor financial decisions'.
This case is a neat illustration however of ensuring that you obtain specialist advice on divorce and attempt to secure an order which results in a clean break if possible.
To discuss this or any other family related matter, contact us.